Venezuela blocking $3.8bn in airline funds says IATA
07 / 06 / 2016
Venezuela and Nigeria top an IATA list of five countries blocking the repatriation of airline funds, a global problem which exceeds $5bn in total.
IATA has called on governments to respect international agreements obliging them to ensure airlines are able to repatriate their revenues.
According to statistics issued by IATA, Venezuela is currently blocking nearly $3.8bn in airline funds, followed by Nigeria at $591m, Sudan at $360m, Egypt at $291 and Angola at $237m. The time that the amount has been held varies between 16 and four months.
Tony Tyler, IATA’s director general and chief executive, said: “Air connectivity is vital to all economies.
"The airline industry is a competitive business operating on thin margins. So the efficient repatriation of revenues is critical for airlines to be able to play their role as a catalyst for economic activity.”
Speaking at IATA’s annual general meeting in Dublin, Tyler continued: “It is not reasonable to expect airlines to invest and operate in nations where they cannot efficiently collect payment for their services.”
He added: “Blocked funds are a problem in a diverse group of countries, some of them undergoing significant economic challenges particularly with a fall-off in oil revenues.
“But one thing all five nations have in common is the urgent need for robust air connectivity that is being hampered by airlines’ difficulty in repatriating funds.
"Strong connectivity is an economic enabler and generates considerable economic and social benefits — something that struggling economies need more than ever. It is in everybody’s interest to ensure that airlines are paid on-time, at fair exchange rates and in full.”
An IATA statement added: “Airline funds blocked from repatriation in Venezuela total $3.8bn. Currency controls implemented in 2003 necessitate government approval to repatriate funds.
“By 2013, approvals were not keeping pace with the amount of funds requiring repatriation and significant airline revenue accumulated in Venezuela.
“The situation became critical in 2015 when only one request to repatriate funds was approved. So far in 2016 only one request to repatriate funds has been granted.”
On Nigeria, IATA stated: “Repatriation issues arose in the second half of 2015 when demand for foreign currency in the country outpaced supply and the country’s banks were not able to service currency repatriations.
"Nigerian authorities are engaged with the airlines and are, together with the industry, seeking possible measures to make the funds available.”